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Explaining to my parents what I do

neelsomani.com

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Re: Explaining to my parents what I do

#11

Post by finite_jest »

thuruv wrote: post #7

// Albert Einstein said: "If you can't explain it to a six year old, you don't understand it yourself." I like to think this is true about explaining things to my parents - Isn't this a quote by Richard Feynman?

I think that is probably a "folk quote", the attribution to Feynman is also inaccurate AFAIK. He said something similar though:

> Feynman was a truly great teacher. He prided himself on being able to devise ways to explain even the most profound ideas to beginning students. Once, I said to him, “Dick, explain to me, so that I can understand it, why spin one-half particles obey Fermi-Dirac statistics.” Sizing up his audience perfectly, Feynman said, “I’ll prepare a freshman lecture on it.” But he came back a few days later to say, “I couldn’t do it. I couldn’t reduce it to the freshman level. That means we don’t really understand it.”

– Feynman’s Lost Lecture by David and Judith Goodstein

Re: Explaining to my parents what I do

#12

Post by pedrosorio »

I know close to nothing about economics and was a bit confused by this statement:

"The line sloping downwards represents demand. As quantity increases (bottom axis), the price people are willing to pay also decreases."

This makes it sound like there is an "available demand quantity" that is the independent variable and a "price" that is the dependent variable. But it seems a lot more intuitive to say "demand increases (I want to buy more and more people are willing to buy) if a good is offered at a lower price", where price is the independent variable.

Re: Explaining to my parents what I do

#13

Post by beambot »

thuruv wrote: post #7

// Albert Einstein said: "If you can't explain it to a six year old, you don't understand it yourself." I like to think this is true about explaining things to my parents - Isn't this a quote by Richard Feynman?

I found it ironic that this initial quote seemed to be the intent of the article... which then goes on to display charts and equations that are unlikely to jive with a six year old.

Re: Explaining to my parents what I do

#14

Post by xyzzyz »

joshkrycerick wrote: post #9

Super interesting read. I ended up getting curious as to who he worked for, checked out his LinkedIn and it turns out he works for Citadel.. I swear I've heard of that company somewhere? ;)

He says he works at Citadel in the article itself. It’s a pretty large company in its market, doing rather well.

Re: Explaining to my parents what I do

#15

Post by kjaftaedi »

beambot wrote: post #13
thuruv wrote: post #7

// Albert Einstein said: "If you can't explain it to a six year old, you don't understand it yourself." I like to think this is true about explaining things to my parents - Isn't this a quote by Richard Feynman?

I found it ironic that this initial quote seemed to be the intent of the article... which then goes on to display charts and equations that are unlikely to jive with a six year old.

This concept is not about explaining things in terms a 6 year old can understand.

It's about understanding the subject matter well enough that if necessary you could simplify and elaborate on topics to bring your audience to your level of understanding.

(i.e. - understanding your subject vs. being able to recite facts)

You really come to terms with how well you know a subject when you sit down and try to teach it to someone else.

Re: Explaining to my parents what I do

#16

Post by DavidPeiffer »

>Another distinction is that most people will trade the average price of power over a given area called a "zone." But there are thousands of physical busses that people connect to, each of which has its own power price, and you can trade those via nodal trading (with instruments like FTRs and ARRs, again not worth going into).

This is really an interesting concept. It looks like nodal trading is available in the northeast - is it dependent on the RTO and how it is run? I'm passively familiar with some utility policies in Iowa but hadn't heard that brought up on the consumption side.

To the extent you can discuss, I'm curious what your saw during the Texas energy crisis about a year ago?

I spent a couple years on the buying and forecasting side for a very large manufacturing facility mostly on natural gas but heard some of the electricity discussions. Force Majeure conditions could lead to very large penalties if we exceeded our forecasted demand. I also sat in on some meetings discussing the massive electricity consumption and strategies to minimize total cost.

The biggest thing most consumers don't realize is how variable the production costs are. On the hottest days when everyone is using their air conditioners, special power plants come online to cover the added load. These peaker power plants may only run a handful of days per year, are cheap to build, but are very expensive to operate. Residential consumers often pay the same electricity cost per kWh despite the utility paying a highly variable cost.

Re: Explaining to my parents what I do

#17

Post by caminante »

whatever1 wrote: post #10

Pricing at marginal cost is the biggest steal in economics. Just because one folk who contributes 0.1% to the energy mix has double the average cost, everyone gets to sneak in and get free money. Specially true in the last winter in Texas where we paid billions to the big power generators only to freeze to death. The best trick that I have seen happening in the industry is suffocating supply so that the new marginal…

For that, I don't blame the generation market as much as I fault legislators for horrible delays in decisions. The market cleared at the $9k/MWh cap for an excessive amount of time.

E: and it was avoidable!

Re: Explaining to my parents what I do

#18

Post by caminante »

beambot wrote: post #13
thuruv wrote: post #7

// Albert Einstein said: "If you can't explain it to a six year old, you don't understand it yourself." I like to think this is true about explaining things to my parents - Isn't this a quote by Richard Feynman?

I found it ironic that this initial quote seemed to be the intent of the article... which then goes on to display charts and equations that are unlikely to jive with a six year old.

That is a good way to curse your self!

Re: Explaining to my parents what I do

#20

Post by whatever1 »

caminante wrote: post #17
whatever1 wrote: post #10

Pricing at marginal cost is the biggest steal in economics. Just because one folk who contributes 0.1% to the energy mix has double the average cost, everyone gets to sneak in and get free money. Specially true in the last winter in Texas where we paid billions to the big power generators only to freeze to death. The best trick that I have seen happening in the industry is suffocating supply so that the new marginal…

For that, I don't blame the generation market as much as I fault legislators for horrible delays in decisions. The market cleared at the $9k/MWh cap for an excessive amount of time. E: and it was avoidable!

There was huge backlash even when this super high cap was passed. The initial idea was that the market will regulate itself, thus no cap is needed.

The small detail they let out of the equation is that the taxpayers will have to bail out the market if it does not regulate itself.

And boy did we pay for nice ceo bonuses that spring.

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